A stock with low volatility can be reassuring, but it doesn’t always mean strong long-term performance. Investors who prioritize stability may miss out on higher-reward opportunities elsewhere.
Luckily for you, StockStory helps you navigate which companies are truly worth holding. That said, here are two low-volatility stocks providing safe-and-steady growth and one stuck in limbo.
One Stock to Sell:
Okta (OKTA)
Rolling One-Year Beta: 0.95
Named after the meteorological measurement for cloud cover, Okta (NASDAQ: OKTA) provides cloud-based identity management solutions that help organizations securely connect their employees, partners, and customers to the right applications and services.
Why Do We Think Twice About OKTA?
- Sales trends were unexciting over the last three years as its 20% annual growth was below the typical software company
- Estimated sales growth of 8.7% for the next 12 months implies demand will slow from its three-year trend
- Capital intensity will likely increase as its free cash flow margin is anticipated to drop by 3.8 percentage points over the next year
Okta’s stock price of $91.20 implies a valuation ratio of 5.5x forward price-to-sales. Check out our free in-depth research report to learn more about why OKTA doesn’t pass our bar.
Two Stocks to Watch:
McDonald's (MCD)
Rolling One-Year Beta: 0.33
With nicknames spanning Mickey D's in the U.S. to Makku in Japan, McDonald’s (NYSE: MCD) is a fast-food behemoth known for its convenience and broken ice cream machines.
Why Do We Watch MCD?
- Bold push to open new restaurants demonstrates an ambitious strategy to establish itself in underpenetrated territories
- Attractive franchise model leads to wonderful unit economics and a best-in-class gross margin of 57%
- Strong free cash flow margin of 27% enables it to reinvest or return capital consistently
McDonald's is trading at $314.28 per share, or 24.6x forward P/E. Is now a good time to buy? Find out in our full research report, it’s free.
TransDigm (TDG)
Rolling One-Year Beta: 0.86
Supplying parts for nearly all aircraft currently in service, TransDigm (NYSE: TDG) develops and manufactures components and systems for military and commercial aviation.
Why Will TDG Beat the Market?
- Core business is healthy and doesn’t need acquisitions to boost sales as its organic revenue growth averaged 13% over the past two years
- Performance over the past two years shows its incremental sales were extremely profitable, as its annual earnings per share growth of 24.9% outpaced its revenue gains
- Impressive free cash flow profitability enables the company to fund new investments or reward investors with share buybacks/dividends, and its growing cash flow gives it even more resources to deploy
At $1,270 per share, TransDigm trades at 30.3x forward P/E. Is now the right time to buy? See for yourself in our comprehensive research report, it’s free.
High-Quality Stocks for All Market Conditions
Trump’s April 2025 tariff bombshell triggered a massive market selloff, but stocks have since staged an impressive recovery, leaving those who panic sold on the sidelines.
Take advantage of the rebound by checking out our Top 5 Strong Momentum Stocks for this week. This is a curated list of our High Quality stocks that have generated a market-beating return of 183% over the last five years (as of March 31st 2025).
Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 2025) as well as under-the-radar businesses like the once-micro-cap company Tecnoglass (+1,754% five-year return). Find your next big winner with StockStory today for free. Find your next big winner with StockStory today. Find your next big winner with StockStory today
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